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Directors Report of Mukesh Babu Financial Services Ltd.

Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting the Twenty Ninth Annual Report and the audited statement of accounts for the year ended 31st March, 2014.

31.3.2014 31.03.2013

Total Income 81,617,228 78,772,935

Profit before Interest , Depreciation and Tax 76,766,318 73,279,833

Less: Interest 16,052,787 17,860,049

Gross Profit 60,713,531 55,419,784

Less : Depreciation 838,375 927,519

Profit before Taxation 59,875,156 54,492,265

Less : Taxation Provision & Deferred Tax 16,790,370 14,989,309

Profit available after Taxation 43,084,786 39,502,956

Add: Profit & Loss A/c Credit Balance 178,274,771 154,825,822 Brought Forward

Profit Available for Appropriation 221,359,557 194,328,778

Less: Transfer to Statutory Reserve 8,616,957 7,900,591

Less: Provision for Dividend 6,970,900 6,970,900

Less: Provision for Dividend Tax 1,184,704 1,184,704

Less: Provision for Standard Assets 138,261 (2,188)

Profit & Loss A/c Credit Balance 204,448,735 178,274,771 Carried Forward

MANAGEMENT DISCUSSION AND ANALYSIS Financial Review

Your Company earned a net profit of Rs.430.85 Lacs for the financial year ended 31st March, 2014 as compared to previous year''s net profit of Rs.395.03 lacs. Depreciation during the year was Rs.8.83 Lacs as compared to Rs.9.28 Lacs in the previous year. Provision for taxation during the year is Rs.167.90 Lacs including Deferred Tax Provision as compared to Rs.149.89 Lacs in previous year.

Opportunities

Though during the Financial Year 2013-14, Indian GDP grew by only 5%. However, with a stable government that the Indian Electorate has given at the Centre, the Stock Market and Foreign Institutional Investors have viewed this development positively. The BSE Sensex touched an all time high level of 25,000 on the proclamation of the election results. The stock market has been responding bullishly to pledges by the new government to grow India''s economy by boosting manufacturing and investment, creating new jobs and rolling out much-needed infrastructure, among other promises. With the liquidity that has come into the stock markets equity as a asset class is likely to outperform other asset classes. India still emerges as one of the most sought-after emerging markets for Foreign Institutional Investors. Your company continues to believe in investing in companies, which have good potentials and in specific sectors that will do well in times to come.

Challenges

The Indian Financial Market being closely integrated with the international markets, the challenge is the volatility in the Indian Markets, which is associated with the international events. Earlier this year, investors made a massive exodus from emerging markets on rising geopolitical tensions and worries about the U.S. Federal Reserve raising interest rates. However, with a stable government at the Centre, optimistic view is in sight for the ensuring financial year. Your company is confident of facing all these challenges with its expertise and long-standing experience and is confident of achieving good growth

Risk Management

,Business and revenue growth have to be weighed in the context of the risks. Being an investment Company your Company is exposed to credit, market and operational risks. As part of the risk management process, your Company reviews the various risks and finalises mitigation plans which are reviewed every quarter by Audit Committee of Directors. Proposals of the audit committee are also discussed at the meeting of the Board of Directors every quarter.

Internal Control Systems and their adequacy.

The Company has an adequate system of internal controls and systems. The scope of the inspection and audit has been recently reviewed to make it more effective.

Human Resources

Industrial relations in the organisation continued to be cordial during the year.

No employee of the Company was in receipt of remuneration for whole/part of the year exceeding the limits prescribed under Section 217 (2A) of the Companies Act, 1956.

Corporate Governance

A comprehensive report on Corporate Governance as stipulated under clause 49 of the Listing Agreement is attached to this Report.

The Company has obtained a certificate from the auditors regarding compliance of conditions of corporate governance as stipulated in Clause 49 of the Listing Agreement and the same is annexed.

Subsidiary

During the year the Subsidiary Company, Mukesh Babu Securities Limited, earned a profit before tax of Rs.432.75 Lacs as compared to Rs.118.71 Lacs during the previous year.

Dividend

The Board of Directors has recommended a dividend of 10% (Previous year 10%) for the year subject to the approval of the shareholders at the Annual General Meeting.

Directors

Mr. Pankaj Majithia, Director, retires by rotation and being eligible offers himself for re-appointment. A brief resume of the Director retiring by rotation/ seeking appointment at the ensuing Annual General Meeting, nature of Directors'' expertise in specific areas and names of the companies in which they hold directorships and /or membership/Chairmanship of committees of the Board as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are given in the Corporate Governance Report.

Directors'' Responsibilities statement

Pursuant to the requirement under Section 217(2AA) of the Companies (Amendment) Act, 2000 with respect to Directors'' Responsibilities Statement, it is hereby confirmed:

(i) that the preparation of the annual accounts for the financial year ended 31st March, 2014, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for the year under review;

(iii) that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) that the directors had prepared the accounts for the financial year ended 31st March, 2014 on a going concern basis.

Auditors

The current auditors Shah, Shah & Shah, Chartered Accountants, retire on conclusion of the ensuing Annual General Meeting and being eligible for re- appointment, have shown their willingness to be re- appointed.

Conservation of Energy, Technology Absorption And Foreign Exchange Earnings and Out Go.

As the Company is a financial Company, no particulars are required to be given regarding Conservation of Energy and Technology Absorption.

Foreign exchange earnings during the year Rs.Nil (Previous Year Rs.Nil)

Foreign exchange outgo during the year Rs.Nil (Previous Year Rs.Nil)

Fixed Deposits

During the year the Company has not accepted any deposit from public.

Cash Flow Statement:

As per the Clause 32 of the Listing Agreement entered into the with The Stock Exchanges, Cash Flow Statement for the year ended 31st March, 2014 duly examined by the Auditors of the Company is furnished along with the audited financial statements of the Company.

Acknowledgements

Your Directors wish to thank the Bankers as well as the Shareholders of the Company. The Directors also wish to place on record their deep appreciation for the services rendered by the employees of the Company.

For and on behalf of Mukesh Babu Financial Services Ltd.

Sd/- Place : Mumbai Mukesh Babu Date: 30/05/2014 Chairman


Mar 31, 2012

The Directors have pleasure in presenting the Twenty Seventh Annual Report and the audited statement of accounts for the year ended 31 March, 2012.

FINANCIAL RESULTS Year Ended Year Ended 31.03.2012 31.03.2011 Rs. Rs.

Total Income 121,095,368 111.045.820

Profit before Interest, Depreciation and Tax 115,192,194 102,185,452

Less: Interest 26,209,438 27,749,794

Gross Profit 88,982,756 74,435,658

Less: Depreciation 906,244 1,052,468

Profit before Taxation 88,076,512 73,383,190

Less: Taxation Provision & Deferred Tax 25,124,409 21,234,587

Profit available after Taxation 62,952,102 52,148,603

Add: Profit & Loss A/c Credit Balance Brougnt Forward 112,818,927 79,202,419

Add/(Less):lncome tax for Earlier Years 70,000 (620)

Profit Available for Appropriation 175,841,029 131,350,402

Less: Transfer to Statutory Reserve 12,590,420 10,429,721

Less: Provision for Dividend 6,970,900 6,970,900

Less: Provision for Dividend Tax 1,130,854 1,130,854

Less: Provision for Standard Assets 323,034 -

Profit & Loss A/c Credit Balance Carried Forward 154,825,821 112,818,927

Corporate Governance

A comprehensive report on Corporate Governance as stipulated under clause 49 of the Listing Agreement is attached to this Report.

The Company has obtained a certificate from the auditors regarding compliance of conditions of corporate governance as stipulated in Clause 49 of the Listing Agreement and the same is annexed.

Subsidiary

During the year the Subsidiary Company, Mukesh Babu Securities Limited, earned a profit before tax of Rs.72.76 Lacs as compared to Rs. 62.54 Lacs during the previous year.

Dividend

The Board of Directors has recommended a dividend of 10% (Previous year 10%l) for the year subject to the approval of the shareholders at the Annual General Meeting.

Directors

Mr. K. Chandrasekhar, Director, retires by rotation and being eligible offers himself for re-appointment. A brief resume of the Director retiring by rotation/ seeking appointment at the ensuing Annual General Meeting, nature of Directors' expertise in specific areas and names of the companies in which they hold directorships and /or membership/Chairmanship of committees of the Board as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are given in the Corporate Governance Report.

Directors' Responsibilities statement

Pursuant to the requirement under Section 217(2AA) of the Companies (Amendment) Act, 2000 with respect to Directors' Responsibilities Statement, it is hereby confirmed:

(i) that the preparation of the annual accounts for the financial year ended 31st March, 2012, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for the year under review;

(iii) that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) that the directors had prepared the accounts for the financial year ended 31** March, 2011 on a going concern basis.

Auditors

The current auditors Shah, Shah & Shah. Chartered Accountants, retire on conclusion of the ensuing Annual General Meeting and being eligible for re- appointment, have shown their willingness to be re- appointed.

Conservation of Energy, Technology Absorption And Foreign Exchange Earnings and Out Go.

As the Company is a financial Company, no particulars are required to be given regarding Conservation of Energy and Technology Absorption.

Foreign exchange earnings during the year Rs. NIL (Previous Year Rs. NIL)

Foreign exchange outgo during the year Rs. Nil (Previous Year Rs. 91,025)

Fixed Deposits

During the year the Company has not accepted any deposit from public.

Cash Flow Statement:

As per the Clause 32 of the Listing Agreement entered into the with The Stock Exchanges, Cash Flow Statement for the year ended 31st March, 2012 duly examined by the Auditors of the Company is furnished along with the audited financial statements of the Company.

Acknowledgements

Your Directors wish to thank the Bankers as well as the Shareholders of the Company. The Directors also wish to place on record their deep appreciation for the services rendered by the employees of the Company.

For and on behalf of

Mukesh Babu Financial Services Ltd.

Sd/-

Place: Mumbai Mukesh Babu

Date: 13/08/2012 Chairman


Mar 31, 2010

The Directors have pleasure in presenting the Twenty Fifth Annual Report and the audited statement of accounts for the year ended 31st March, 2010.

FINANCIAL RESULTS Year Ended Year Ended

31.03.2010 31.03.2009

Rs. Rs.

Total Income 92,903,261 14,806,883

Profit before Interest, Depreciation and Tax 77,890,068 9,429,558

Less: Interest 2,619,714 -

Gross Profit 75,270,354 9,429,558

Less: Depreciation 1,282,721 866,676

Profit before Taxation 73,987,633 8,562,882

Less: Taxation Provision & Deferred Tax 21,958,935 222,673

Profit available after Taxation 52,028,698 8,340,209

Add: Profit & Loss A/c Credit Balance Brougnt Forward 45,599,766 38,942,795

Add/(Less):lncome tax for Earlier Years 131,030 (18,995)

Profit Available for Appropriation 97,759,494 47,264,009

Less: Transfer to Statutory Reserve 10,405,740 1,664,243

Less: Provision for Dividend 6,967,250 -

Less: Provision for Dividend Tax 1,184,084 -

Profit & Loss A/c Credit Balance Carried Forward 79,202,420 45,599,766

MANAGEMENT DISCUSSION AND ANALYSIS

Financial Review

Your Company earned a net profit of Rs. 520.29 Lacs for the financial year ended 31st March, 2010 as compared to previous years net profit of Rs. 83.40 lacs. Depreciation during the year was Rs 12.83 Lacs as compared to Rs.8.67 Lacs in the previous year. Provision for taxation during the year is Rs. 219.59 Lacs including Deferred Tax Provision as compared to Rs. 2.23 Lacs in previous year.

Opportunities

The Indian economy has been robust and the Indian economy emerging as a economic super power is quite evident from the performance of various sectors of the economy. The stock market has been performing well and the index is a clear reflection of the good performance of the economy. Though inflation has been a cause for concern for the economy, the Honble Prime Minister of our country is confident of bringing inflation to controllable levels by December, 2010. Your company continues to believe in investing in companies, which have good potential and in sectors that will be the sunshine sectors in the good times ahead.

Challenges

The integration of our stock market with the Global markets results in increased volatility and unpredictability in our stock and financial markets. However, with Indian Economy doing exceedingly well, the challenge before your company lies in identifying strong companies and sectors where investment can be made for good returns. Your company management is confident of making the right investment decisions on account of the two decades of experience that it has in the field.

Risk Management

Business and revenue growth have to be weighed in the context of the risks. Being an investment company your company is exposed to credit, market and operational risks. As part of the risk management process, your company reviews the various risks and finalises mitigation plans which are reviewed every quarter by Audit Committee of Directors. Proposals of the audit committee are also discussed at the meeting of the Board of Directors every quarter.

Internal Control Systems and their adequacy.

The Company has an adequate system of internal controls and systems. The scope of the inspection and audit has been recently reviewed to make it more effective.

Human Resources

Industrial relations in the organisation continued to be cordial during the year.

No employee of the Company was in receipt of remuneration for whole/part of the year exceeding the limits prescribed under Section 217 (2A) of the Companies Act, 1956.

Corporate Governance

A comprehensive report on Corporate Governance as stipulated under clause 49 of the Listing Agreement is attached to this Report.

The Company has obtained a certificate from the auditors regarding compliance of conditions of corporate governance as stipulated in Clause 49 of the Listing Agreement and the same is annexed.

Subsidiary

During the year the Subsidiary, Mukesh Babu Securities Limited, earned a profit before tax of Rs. 79.43 Lacs as compared to Rs.31.86 Lacs during the previous year.

Dividend

The Board of Directors has recommended a dividend of 10% (Previous year nil) for the year subject to the approval of the shareholders at the Annual General Meeting.

Directors

Mr. Vijay Vora, Director, retires by rotation and being eligible offers himself for re-appointment.

A brief resume of the Director retiring by rotation/ seeking appointment at the ensuing Annual General Meeting, nature of Directors expertise in specific areas and names of the companies in which they hold directorships and /or membership/Chairmanship of committees of the Board as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are given in the Corporate Governance Report.

Directors Responsibilities statement

Pursuant to the requirement under Section 217(2AA) of the Companies (Amendment) Act, 2000 with respect to Directors Responsibilities Statement, it is hereby confirmed:

(i) that the preparation of the annual accounts for the financial year ended 31st March, 2010, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for the year under review;

(iii) that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) that the directors had prepared the accounts for the financial year ended 31st March, 2010 on a going concern basis.

Auditors

The current auditors Shah, Shah & Shah. Chartered Accountants, retire on conclusion of the ensuing Annual General Meeting and being eligible for re- appointment, have shown their willingness to be re- appointed.

Conservation of Energy, Technology Absorption And Foreign Exchange Earnings and Out Go.

As the Company is a financial company, no particulars are required to be given regarding Conservation of Energy and Technology Absorption.

Foreign exchange earnings during the year Rs. NIL (Previous Year NIL) Foreign exchange outgo during the year Rs. NIL (Previous Year NIL)

Fixed Deposits

During the year the Company has not accepted any deposit from public.

Cash Flow Statement:

As per the Clause 32 of the Listing Agreement entered into the with The Stock Exchanges, Cash Flow Statement for the year ended 31st March, 2010 duly examined by the Auditors of the Company is furnished along with the audited financial statements of the Company.

Acknowledgements

Your Directors wish to thank the Bankers as well as the Shareholders of the Company. The Directors also wish to place on record their deep appreciation for the services rendered by the employees of the Company.

For and on behalf of

Mukesh Babu Financial Services Ltd.

Sd/-

Place : Mumbai Mukesh Babu

Date: 27/08/2010 Chairman

 
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